Bitcoin Tumbles As South Korea Mulls Closing Cryptocurrency Exchanges
Bitcoin's value dropped to below $13,000 earlier today, sliding around 14 percent after South Korea's government announced plans to ban cryptocurrency trading altogether. While perhaps a knee-jerk reaction and a temporary blip in the long run, there is cause for some concern, as South Korea is a major global hub for the virtual coin market. As such, the plan to ban cryptocurrency trading in the region is a bit of a big deal.
"There are great concerns regarding virtual currencies and the justice ministry is basically preparing a bill to ban cryptocurrency trading through exchanges," Justice Minister Park Sang-ki stated during a news conference.
Bitcoin's value dropped to a low of $12,845.71, down from a day long high of $14,942.61. It has been fluctuating ever since and is currently trading at just over $14,000. Such is the volatility of cryptocurrency, and especially Bitcoin, the most popular digital coin out there.
Whether or not South Korea goes through with the ban remains to be seen. Following the sharp drop in reaction to the announcement, the Justice Minister's office later clarified that a ban on virtual coin exchanges had not yet been finalized, and that it was one of the measured being considered. There is a still a process to go through, which entails drafting a bill and getting a majority vote from the 297 members of the National Assembly. That process could take months, or even years to complete.
Bitcoin was not the only cryptocurrency to be affected by the announcement. In total, cryptocurrencies collectively lost $100 billion in value due to the proposed ban. The massive drop underscores that investing in virtual coin is a high risk affair with a potentially high reward, though certainly not for the faint of heart or impatient. Case in point, Bitcoin was trading at above $17,000 just last week.